Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which of the following is characteristic of a Power culture?

1. Decentralized decision-making

2. Emphasis on compliance and rules

3. Influence from a single source

4. Collaboration among all team members

The correct answer is: Influence from a single source

A Power culture is defined by its concentration of authority and influence typically stemming from a single source or a small group of individuals within the organization. In this type of culture, decision-making is centralized, and power resides predominantly with those at the top or with the key leader. This structure allows for rapid decision-making since only a few individuals are involved in the process, facilitating swift responses to changing environments or market demands. In contrast, other characteristics highlighted by the remaining options indicate different cultures. Decentralized decision-making, for instance, is more aligned with a Task or Process culture, where authority is distributed across various levels to encourage input from multiple stakeholders. An emphasis on compliance and rules points towards a Role culture, focused on adhering to established procedures and standards. Lastly, collaboration among all team members is representative of a Person culture, where individual contributions are valued and teamwork is prioritized for success. Thus, the defining trait of a Power culture is its top-down approach, where influence predominantly comes from a singular or limited source, streamlining authority and accountability within the organization.